...prospects and fiscal growth. A rise in the budget deficit of the U.S. government causes a rise in actual interest rates. Capital inflows affect such trade balances for example, if the U.S. economy offers better investment opportunities than other nations, the country’s capital flow will increase significantly. With flexible exchange system, the capital inflow tends to increase the value of the U.S dollar in correlation to other currencies. This rise in value of the dollar consequently makes U.S. exports rather less appealing to foreigners and U.S. imports become relatively less expensive; thus, net exports go down. Since 2008, the global economy has gone through significant changes influencing crosscutting growth in all the regions. However, Africa has been resilient in the face adverse challenges such as domestic conflict, worldwide headwinds, and internal supply shocks. Thus, Africa has experienced robust economical growth over the past decade. Africa’s fiscal growth has drastically increased over the past decade. This robust economic growth has seen the continent become a hub of new commercial vibrancy. Figure 1.0 below illustrates Africa’s GDP trends between the years 2001 and 2012, with projections for 2013-2014. The figure illustrates an average growth of Africa’s economic performance since the year 2001, averaging above 5%. It also approximates the growth of North Africa and Sub-Saharan Africa averaging at 4.5% and 5.6% respectively. 1n 2011, Africa experienced a notable...
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...13164067 1) With reference to theories of growth and development, explain the contrasting growth experience of China and Sub Saharan Africa post 1980. Economic growth, put simply, is “an increase in the amount of goods and services produced per head of the population over a period of time”; development is inextricably linked with this economic growth. By utilising theories of economic growth and development we can see how the Chinese and Sub-Saharan African economies have emerged, but, more notably, we can use these to look at patterns from past and present to show their experience and the implications of this growth for the future. Development has become synonymous for industrialisation. Economic growth comes from increasing the Gross Domestic Product (GDP), this is done by producing more through the addition of more capital and labour. As you begin to use up the factors of production the law of diminishing returns can hinder growth. Therefore, a vital factor for the development of emerging markets is technology, which should be harnessed to improve means of production and other such things to see a progressive economy. In this sense I will be looking at both China and Sub-Saharan Africa to see how technology or the lack thereof has been utilised and the implications this has had on their economies. There are a number of factors that have contributed to Sub-Saharan African (SSA) countries generally not experiencing the rates of growth and development as other emerging market...
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...INTRODUCTION Most developing countries in the Sub-Saharan Africa, on average witnessed significant and consistent economic growth in their early years of independence (World Bank, 2004). Although majority of these countries succeeded in expanding their basic infrastructure and social services among others. It was therefore anticipated that much progress will be achieved in terms of raising the average income per head and improving on the general welfare of Africa following the average growth in real per capita income of about 3.8 % per annum between 1967 and 1970 (Mbanga, 2008). In the early 1970s, developing countries borrowed to finance their current account deficit. Such borrowing was geared towards boosting the level of economic growth and development. By 1980s, the developing countries’ debt had accumulated and the international financial institutions from this period started to provide both technical and financial debt-management assistance to debtor countries. However, this effort still aimed at fostering economic growth, was also equally meant to reduce both debt burdens and poverty level of these...
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...RACE, GENDER AND GROWTH OF THE AFFLUENT MIDDLE CLASS IN POSTAPARTHEID SOUTH AFRICA BIENNIAL CONFERENCE OF THE ECONOMIC SOCIETY OF SOUTH AFRICA, UNIVERSITY OF THE FREE STATE, BLOEMFONTEIN, SOUTH AFRICA, 25-27 SEPTEMBER 2013 Justin Visagie justinvisagie@gmail.com Abstract This paper examines the development of the middle class in post-apartheid South Africa, using data from the 1993 Project for Statistics on Living Standards and Development, the 2000 Income and Expenditure Survey/Labour Force Survey and the 2008 National Income Dynamics Study. The affluent middle class are defined as individuals residing in a household with a per capita income of R1,400 – R10,000 per month in 2008 prices. The paper explores changes in the size of the middle class as well as the racial and gender profile of the middle class within the context of Black Economic Empowerment in South Africa. The affluent middle class experienced very modest growth over the period, only slightly ahead of population growth. There was however substantial churning in the racial composition of the middle class, with a large increase in the number of Africans accompanied by a fewer number of Whites. The gender profile of the middle class showed less conclusive evidence of transformation. The upper class similarly experienced significant racial transformation and more than doubled in size, and also accrued a higher share of total income (at the expense of the income shares of middle and lower classes). 1. Introduction...
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...the fact remains, Africa's problems are by and large internal…True, agricultural subsidies must be lifted by the US and the EU, but simply throwing aid money at the problem will ultimately come to no good. After all, even when African countries do possess sources of great wealth--diamonds in Sierra Leone and oil in Nigeria, for instance--those resources often end up being a curse on95% of the respective country's populace. On the other hand, a few nations have done better through internal improvements; Botswana is often cited as an example of this, but their 40% Aids rate--definitely attributable to rampant sexual activity--is impossible to overlook. Encapsulated in this spiel are what could be termed ‘the four great fallacies of the Africa Debate’. I’ll attend to each of these in turn. Fallacy 1 - Africa’s problems are by in large internal There’s no denying that some of Africa’s problems are internal but the claim that they are entirely (or even by in large internal) is demonstrably false: it ignores history and turns a blind eye to the interconnected world that we live in. For a start, many of Africa’s current problems stem from the colonial epoch; and colonialism was hardly an internal process. Instead, an external force (that’s us – the Europeans) plundered Africa’s natural and human resources and set in place tools of governance (involving an extractive local elite) that still haunt the continent today. The example that Chris uses above of Botswana...
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...Economic Commission for Africa The Millennium Development Goals in Africa: Progress and Challenges Economic Commission for Africa The Millennium Development Goals in Africa: Progress and Challenges August 2005 © 2005. Economic Commission for Africa Material from this publication may be freely quoted or reprinted. Acknowledgment is requested, together with a copy of the publication. The views expressed are those of the original authors and do not necessarily reflect those of the United Nations. Project coordinator: Adrian Gauci Editorial coordination: Cristina Müller Team: Abebe Shimeles, Workie Mitiku, Vanessa Steinmayer, Reto Thoenen This report was produced with guidance and input from Augustin Fosu, Director of the Economic and Social Policy Division of the ECA. It benefited greatly from the revisions of Bartholomew Armah and Kwabia Boateng. Special thanks to Lorna Davidson for the final editing, to Akwe Amosu for her valuable input, and to Seifu Dagnachew and Teshome Yohannes for creative and efficient lay-out and production. The report was designed by the ECA Communication Team and printed by the Documents Reproduction and Distribution Unit, in Addis Ababa, Ethiopia. Photo credits (left to right): Front cover- R. Zurba/USAID, J. Dunlop/USAID, R. Zurba/USAID, M. Crozet/ILO. Back cover- J. Maillard/ILO, T. Brunette/USAID, I. Getachew/UNICEF. Table of Contents Acronyms .....................................................................
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...Africa’s path to growth: Sector by sector The continent’s growth story isn’t entirely about the extractive industries. Seven articles examine the future of a wide range of sectors. Although Africa’s growth prospects are bright, they differ not only country by country but also sector by sector. In these articles, we examine the possibilities for seven of them: agriculture, banking, consumer goods, infrastructure, mining, oil and gas, and telecommunications. Perhaps the most fundamental point is that Africa’s growth story is hardly limited to the extractive industries. As many as 200 million Africans will enter the consumer goods market by 2015. Banking and telecommunications are growing rapidly too, and infrastructure expenditures are rising significantly faster in Africa than in the world as a whole. Not that the growth of the extractive industries won’t be impressive. The continent has more than one-quarter of the world’s arable land. Eleven of its countries rank among the top ten sources for at least one major mineral. Africa will produce 13 percent of global oil by 2015, up from 9 percent in 1998. For many companies, this is a future worth investing in. 2 Africa’s path to growth: Sector by sector Agriculture: Abundant opportunities Kartik Jayaram, Jens Riese, and Sunil Sanghvi Agriculture is Africa’s largest economic sector, representing 15 percent of the continent’s total GDP, or more than $100 billion annually. It is highly concentrated, with Egypt and Nigeria...
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...HISTORY South Africa is the southernmost country on the African continent. It has a long history of conflict and human rights issues but it has always been one of the most economically prosperous nations in southern Africa due to its coastal location and the presence of gold, diamonds and natural resources. By the 14th century C.E, the region was settled by the Bantu people who migrated from central Africa. South Africa was first inhabited by Europeans in 1488 when the Portuguese arrived at the Cape of Good Hope. However, permanent settlement did occur until 1652 when the Dutch In following years, French, Dutch and German settlers began to arrive in the region. by the end of the 18th century the British controlled the entire Cape of Good Hope region. In 1961, South Africa became a republic after it withdrew from the British Commonwealth Four years later on May 10, 1994, Mandela was elected as South Africa's first black president and during his time in office he was committed to reforming race-relations in the country and strengthening its economy and place in the world. This has remained the goal of subsequent governmental leaders. ECONOMY South Africa has a mixed economy, the largest in Africa in terms of both nominal GDP (at $375.944 billion) and GDP atpurchasing power parity (at $608.804 billion). It also has a relatively high GDP per capita compared to other countries in Sub-Saharan Africa ($11,750 at PPP as of 2012). Despite this, South Africa is still burdened...
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...the United States is still at the forefront in the economic world along with Europe, the days of their dominance is slowly dwindling. Regions such as China, South America particularly Brazil, India and others are growing at rates never before seen in these nations due to a multitude of different economic factors. However, in this new world economy, Africa seems to be left out. A place with an abundance of natural resources and agricultural capabilities, Africa has yet to reach its full potential. There are many theories to which one could attribute the lack of growth in Africa to but I will be specifically looking at decolonization and how, in my opinion, it has disallowed Africa to become a major player in the world economy. to understand why africaneconomies are still not growing like comparable emerging markets one must first start with the history and the worker for he/she is the driving force behind any economic system. in “dialects of decolonization” Cooper gives a detailed history of the French african worker during decolonization and reform movements. focusing on the social aspect of the labour movement, french west africa transitioned from a “class-centered, internationalist organization that insisted that workers subordiante their own concerns, interests and collective awarness to the emerging national struggle”. though this sounds honarbale, the will and the goals of the workers are not economically important and are one of the root causes of the economics problems...
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...interconnected the entire globe to create a singularly biological world. The Western and Eastern Regions of the world, specifically Africa, Europe and the Americas, were now in contact. The social change would be the increase in African slavery because of the many problems with indigenous labor, while the social continuity would be the steady population growth through the period due to the new, substantial American Crops. Perhaps the most obvious and yet the most relevant economic change was the building of a large global trading system; largely due to the Columbian Exchange, where there used to be little to no contact between regions at all. An economic continuity would be the lower classes and their little meaning to society because they had no rights. During this time period we see the change of increased slavery and how the world turned towards Africa to supply the “commodity”. For example, When Pizarro conquered the Incas, he started out using mostly indigenous labor. This was all fine and dandy until the smallpox, measles, and yellow fever that Pizarro and his crew brought over started to predominantly impact the amount of indigenous labor available. When this happened, the Portuguese set their sight on Africa for slaves. However it was not only the Portuguese, but the Spanish and Europeans who had their sights set on Western Africa as well. Africa quickly became a main slave exporter, thus supplying needy Portuguese, etc. with labor that wouldn’t be as affected by the...
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...The Company’s incentive to invest in Africa now Need for Infrastructure development in Africa Africa is rich in natural resources and thus also has an agro-based economy. It is seeing a great demand of its products like tea and coffee internationally leading to higher exports; in spite of the surge in exports, Africa has not been able to rival its counterpart emerging economies like India and China in terms of economic development. The cause of this misbalance is the lack of infrastructure development, which has a direct causal relationship with economic development. It is important to invest in Infrastructure in Africa for poverty reduction and economic development. Infrastructure has always been costly in Africa due to lack of efficiency but that doesn’t deter the increased demand, which resulted from an increase in population and urbanization. The World Bank estimates that the current infrastructure financing needs are US $95 million in Africa out which there is financing for US $45 billion1. The current gap should have been US $48 billion but leads to much more since nearly 35% of it is wasted due to inefficiencies. Most of the current financing in infrastructure has been through the Public sector with the Private sector contributing 21% share2. Infrastructure development would have positive effects in East and Central Africa and would contribute to 2% to the Gross Domestic Product. An example of connection of infrastructure to economic development is seen in China, where...
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...dilemma of sub-Saharan Africa Demographic transformation or transition is referred to as the process by which a country moves from high birth and high death rates to low birth and low death rates with population growth in the interim. The demographic transition model is comprised of 5 stages. The Sub- Saharan African region is believed to be still in stage 1, which refers to having high death rates and high fertility rates (birth rates) although the condition is far better than it was just a few years back. The demographic transition started in European populations living in Europe and elsewhere around 1880 and at present, almost all developing countries have entered the demographic transformation, i.e. mortality rates are declining and fertility rates follow. It was believed that countries in Sub-Saharan Africa will also follow the same pattern. But the demographic transformation has taken the speed of a slug in this part of the world. Sub-Saharan Africa mostly consists of countries regarded as underdeveloped or developing and is part of the so-called Third World. Third World countries share many characteristics but at the continental level they are not the same. For instance, sub-Saharan Africa is sparsely populated, in contrast to South and East Asia, and it is much less urbanized than Latin America. It stands out amidst the other major regions of the Third World for having the slowest rate of economic growth in recent years: an average annual growth rate of gross domestic...
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...Introduction This research task aims to investigate the extent to which apartheid was economically unsustainable. The research will be based on sources with reference to the effect international divestments and economic sanctions placed on South Africa, as well as the internal structure of the apartheid system and it’s impact on the South African economy. Apartheid was set up in a way where black labour was used to exploit the resources of the country, which included mineral resources such as diamonds, gold, coal and iron ore; as well as agricultural resources such as fruits, grains and maize. To give legal effect to this exploitation of labour, the apartheid system created a job reservation system to favour the white minority and to subject...
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...The question of international aid to developing countries in Africa is one of the most controversial subjects in modern development. Even more controversial it is when summits and/or conferences are held and hosted by countries that actually aid the African countries. At first glance it’s very noble deed. However, when scrutinized deeply questions are raised. This paper concentrates on the recently and first ever U. S - African Leaders’ Summit under the theme “Investing in the Next Generation”. The aim of this essay is to provide an objective view of this summit and also on the views given by a number of development analysts with regards to the summit. To begin with it’s vital to give some background to this summit. In 2013, during a three nation tour, at a speech at the University of Cape Town, South Africa, President Obama announced his plans to host a summit for African leaders. He wanted to follow up with a gathering that would help the U.S. reinforce its economic and diplomatic ties with Africa. With this announcement, the United States – African Leaders’ Summit was an international summit held in Washington D. C. from the August 4th -6th 2014. Leaders from an anticipated majority of over fifty African states attended the three-day summit hosted by U.S. president Barack. H. Obama. Its primary focus was on trade and investment, democratic development and security of the continent. It will also highlight the depth and breadth of the United States’ commitment to the African...
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...“Globeleq scrambling for Africa” Table of Contents Introduction 3 Literature Review 4 Globeleq Tanzania 4 Globeleq Egypt 5 Globeleq Cote d’Ivoire 5 Globeleq South Africa 5 Globeleq in Uganda 6 Determinants for the 6 countries that has promoted such as: 6 Successes and Failure 7 Justification and Rational 8 Conclusion 9 Group progress 9 Introduction Foreign Direct Investments (FDIs) in the world today are an important economic resource and tool. Over the last three decades, FDI inflows have produced powerful stimulus for economic development in various countries across the globe. FDI inflows can help an economy by giving opportunities for improving the level of business and legal services, wholesale and retail trade or service sector. Thus, FDI has the potential to create jobs, improve productivity, the exchange of expertise and technology, increase exports and play a significant role in the long-term economic development (Liargovas & Skandalis, 2011; Financial Times (2012); Omisakin et al., 2009). In terms of foreign direct investments, Africa undoubtedly has all the makings of a prospective investment case due to its natural resources, trade openness, rapid economic and population growth, improving environment and maturing political system. As a result, despite a drop in investment in the last couple of years following a peak in 2008, Africa has remained an attractive investment destination throughout the global downturn and has managed to maintain...
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